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3 - Chargebacks

3.1 - Chargeback

A cardholder can dispute a transaction by contacting the bank which issued the card used to pay for the transaction. The cardholder dispute may be for a number of reasons including, but not limited to, card misuse/fraud or a genuine processing error.

When a transaction is disputed, -the card's issuer and the merchant's acquirer (Rapyd) must operate according to the rules and regulations that the card associations have established for chargebacks, to resolve the dispute. The card schemes have clearly defined rules regarding how transactions should be processed as well as the merchant's and the cardholder's responsibilities. Those rules and regulations determine who is liable for the transaction. The issuer can only make a chargeback for a valid and pre-defined reason according to the Card Associations regulations. The reason for the dispute can be identified by the reason code assigned to each chargeback and/or the cardholder documentation.

To reduce the potential loss of funds due to a chargeback it is essential that merchants carefully monitor their disputed transactions and respond promptly to a Retrieval request or a Chargeback via SAGA, the Rapyd Back Office application.

3.1.1 - Respond to chargebacks

Proof that a credit has been issued for a card account is always a valid reason to respond to a chargeback. (For more information, see chapter 4.3 on supporting documents needed for Visa disputes, chapter 5.3 on supporting documents needed for MasterCard disputes and chapter 6.3 on supporting documents needed for American Express disputes).

3.1.2 - Timeframe for chargebacks

The merchant will be required to submit the applicable documentation within 12 days from the registration date of the Chargeback notification as shown on the SAGA Back Office or the Rapyd Dispute Webservice.

The Chargeback will be closed as lost if the merchant fails to submit the required documents within these 12 day period, i.e. the deduction of funds from the merchant and/or processor when the chargeback was received will stand, since documentation from the merchant is always needed to prove the validity of the transaction and reverse the chargeback.